One promising weapon in the battle against cancer is a type of drug called a telomerase inhibitor, which blocks an enzyme that enables cells to replicate indefinitely and is very active in malignant tumors. California-based Geron Corp. (GERN.O) is developing the only such inhibitor that has displayed any potential benefit for patients – imetelstat. However, it’s run into problems with the U.S. Food and Drug Administration (FDA).
Telomerase inhibitors are theoretically very promising candidates for cancer treatment, as most cancers involve heightened telomerase activity. However, imetelstat is currently on complete hold by the FDA for essential thrombocythemia (where the body produces too many blood platelets) due to possible liver toxicity.
During Alpha Deal Group’s initial due diligence call, CFO Olivia Bloom and IR Anna Krassowska said that telomerase is a core target for anti-cancer therapies but so far small-molecule telomerase inhibitors have not yielded any significant preclinical results that would justify clinical trials.
Imetelstat
Unlike other telomerase inhibitors, Geron’s product (the single one it is developing) has demonstrated both potency and efficiency in Phase 1 and 2 trials. The trials have been focusing on the effect of imetelstat on hematologic myeloid malignancies (blood cancers) such as essential thrombocythemia and myelofibrosis.
Since the existing essential thrombocythemia treatments are sufficiently effective, Geron has chosen to direct its efforts to myelofibrosis, myelodisplastic syndromes and acute myelogenous leukemia. The company is putting special focus on myelofibrosis, with 3,000 new cases diagnosed in the U.S. every year and 13,000 people living with the cancer, which has a median survival period of one to three years.
New drug application on hold
During its phase 2 trials, the company reported occurrences of abnormalities in the liver function tests of some patients. This led to the FDA putting on complete clinical hold Geron’s investigational new drug application for imetelstat, citing suspicions of hepatotoxicity in the drug during the trial targeting essential thrombocythemia, since the abnormalities were found in all participants. A complete clinical hold means that neither any ongoing trials can be completed nor can planned ones be initiated. This hold concerns only the ET trials, however.
The company has also been testing the drug in an investigator-sponsored trial on the treatment of myelofibrosis conducted by world-renowned hematologist Dr. Ayalew Tefferi from the Mayo Clinic. The first preliminary efficacy results from this trial were presented at the end of 2013. According to the company, these have demonstrated that they may have a clinical effect on the condition, potentially leading to partial or complete remissions. The hold imposed by the FDA is only partial for the MF trials, which means that patients who have already been enrolled in a trial and have experienced benefits from the treatment could continue taking imetelstat.
Geron and Tefferi are now working to lift the partial hold on MF trials, with Geron undertaking to provide the watchdog with follow-up data on all patients who had experienced liver function test abnormalities, addressing the FDA’s concern that such abnormalities could be irreversible and lead to chronic liver damage. It will also carry out trials on animals to get more information about the reversibility of liver toxicity. At the same time, Tefferi will supply information about the liver function tests of all patients that took part in the investigator-sponsored imetelstat trials.
Geron share price
Source: Thomson Reuters Eikon/StarMine
Financial implications
FDA’s hold caused Geron’s stock to slump from $8 to below $3, essentially trading at cash, within a range of $1.80 to $2.50. However, big name investment groups and private investors have been buying the stock, suggesting a contrarian value play. There is some ground for such a strategy, as the FDA’s only partial hold on the MF trials with imetelstat may suggest that the regulator recognizes the benefits the drug offers and believes they outweigh the risks for trial participants, which was not the case with the ET trial.
Geron financial strength
Source: Thomson Reuters Eikon/StarMine
Balance sheet and outlook
At 2013 yearend, Geron had $66 million in cash and investments. As of the end of February 2014, it had generated $97 million in proceeds from its public placement. The company is considering partnerships for the future in order to cultivate a more comprehensive development plan, Bloom and Krassowska said. Meanwhile, Geron will focus its efforts on achieving a lift of the clinical hold, gathering all information necessary. On a more general strategic level, the company will continue to seek medical areas with high unmet need for treatments.
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